News Article Czech Republic development investment Prague reconstruction residential YIT
by Property Forum | Investment

YIT is the new owner of the Kuta Centrum office complex in Prague 4. In the future, the complex, renamed YIT Office Centrum, should be transformed into a residential complex, the CEO of YIT told online daily

The YIT Office Centrum complex, which YIT bought in Prague 4 from entrepreneur Martin Kuta on the border of Prague's Braník and Krč districts, is likely to undergo a major transformation. "As a residential developer, we plan to convert the office space in the complex into housing in the longer term," Marek Lokaj, CEO of YIT Stavo, told "The location is ideal for these purposes - the complex is located in a quiet and popular residential area with plenty of greenery, yet very accessible by public transport as well as by car from the D1 motorway and Jižní spojka," Lokaj added. In addition, a tunnel and a station on the new D metro line are being built a few hundred metres away, which will further increase the price of local real estate.

The original Kuta Centrum with its offices, restaurant, fitness and wellness centre is in category B and underwent a major transformation almost thirty years ago. The new owner has not yet expressed how he envisions the renovation and whether he intends to demolish or renovate the complex. "In the spirit of our principles and motto of 'fine living thought through by heart', we will use ESG and sustainability principles as much as possible in transforming the site from offices to housing," Lokaj said.

From residential to offices and back

A current trend in the Prague real estate market is the transformation of former apartment buildings, converted in the 1990s or in the first decade of the new millennium into offices, back into housing. Such residential projects are being built, for example, by PSN. A similar office acquisition to YIT was made a few years ago by the developer Daramis, which owns a complex from the 1970s in Prague's Vršovice and plans to build 14 apartment buildings there but is still renting out offices. "The typical category B or C office buildings that are for sale are not the ones investors are interested in, but residential developers," confirmed Jakub Holec, head of the 108 Agency consultancy firm. "The current operating costs and overall standard make it very difficult for tenants to occupy them. That is why owners often decide to sell. The competition for certified modern offices in high standard and with economical operation is really high," added Holec.